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March 14, 2011 at 06:02 AM
As Japan continued to deal with the massive damage inflicted by a record 9.1 magnitude earthquake and tsunami whose aftermath sparked explosions at nuclear reactors, the Nikkei plummeted 633.94 points, or 6.2%, to close at 9,620.49, losing some 23.5 trillion yen ($287 billion) in value on Monday. The Nikkei's drop was its biggest since October 2008, fueled by what was said to be its greatest trading volume in more than 60 years.
Japan’s central bank held interest rates at 0-0.1% and doubled its asset buying, even as some economists called the response inadequate, but Moody’s Investors Service said there was no immediate sign of a financial crisis.
Reuters reported that financial measures were only part of the response to the disaster as markets and rescuers alike struggled to bring order out of the chaotic natural disaster. The Star Advertiser in Hawaii reported that the PacificTsunami Warning Center raised the estimate of the quake’s magnitude from 8.9 to 9.1, accounting for the impact of the quake throughout the Pacific, according to physicist Gerard Fryer. That makes it the fourth most powerful quake since recording began in the late 1800s. The U.S. Geological Survey still rates the quake at 8.9.
Significant damage was done to Japan’s energy infrastructure, with explosions at two nuclear power plants and the threat of the same at a third; rolling blackouts were said to affect 3 million customers, with manufacturing shutting down because of damage and the unreliability of power. Shares of TEPCO, Japan’s largest power company, went untraded with sell orders outnumbering buys 200 to 1.
Questions remained concerning the viability of power in the long term, as workers tried to contain radioactivity from reactors severely damaged by the quake. Reactors remained offline, most likely permanently, as sea water was used to cool nuclear materials to avoid meltdowns.
A number of companies have halted work, with shares plummeting in record trading volumes on everything from carmakers to high-tech parts makers. Ports also sustained severe damage. Homebuilder shares rose substantially on the prospect for rebuilding.
